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Informist, Thursday, Dec. 26, 2024

By Sandeep Sinha

MUMBAI – Futures contracts of most base metals on the Multi Commodity Exchange of India traded in positive territory on expectations of further stimulus support from top consumer China. The People's Bank of China Wednesday infused 300 billion yuan ($41 billion) in the financial system through a one-year lending facility, which also aided the positive sentiment.

"Most of the base metals are likely to trade in a range-bound manner as positive macroeconomic news from China provided some support, but a strong dollar index limited the rise," AngelOne said in a note. The brokerage firm said that recent fiscal meetings in China have introduced proactive fiscal policies, including raising the budget deficit, to support market expectations of a positive increase in demand for metals.

Reuters reported on Tuesday that Chinese authorities plan to issue special treasury bonds worth 3 trillion yuan ($411 billion) next year to support economic growth. 

Thursday's trading volume is likely to be thin as the US market and London Metal Exchange are closed for the Boxing Day holiday and no major economic data releases are scheduled. Commodities are unlikely to see any significant movement this week and next week due to lack of liquidity in view of the Christmas and New Year holidays.

However, further upside in industrial metals was limited by the strength in the dollar. The Dollar Index, which measures the strength of the greenback against a basket of six major currencies, was up 0.1% at 108.17.

ALUMINIUM prices traded a tad lower due to profit-taking by traders on the domestic market.

COPPER prices gained because of short-covering of positions by market participants on the MCX.

LEAD contracts rose due to a technical rebound from oversold levels on the domestic bourse.

ZINC contracts traded in the green as traders raised their long positions on the domestic exchange.

At 1752 IST, on the MCX, the January futures contract of:

–Aluminium was at INR 241.60 a kg, down 0.1%

–Copper was at INR 806.0 a kg, up 0.6%

–Lead was at INR 178.35 a kg, up 0.3%

–Zinc was at INR 282.75 a kg, up 0.3%

Trading levels for the day on the MCX:

-Aluminium contract seen at INR 239.60-243.0

-Copper contract seen at INR 798.10-812.0

-Lead contract seen at INR 177.70-179.00

-Zinc contract seen at INR 281.60-285.0

End

US$1 = INR 85.26

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Rajeev Pai

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